Examining Your Firm’s Business Modelby
In our experience, some of the best strategies for evolving and leveraging resources in one area of our business could be found in another area of our business.
For example, key partnerships were being properly leveraged in one of our training services and not so much in another training service. While some of this was natural evolution and growth of new services, it highlighted our need to tap into the confidence and capabilities of all areas of our business to accelerate growth.
Similar to your firm, our organization doesn't have just one business model. While we have a "macro" business model overarching our entire organization, we have several "micro" business models depending on the type of service (e.g., Communities, Consulting & Training). Depending on the number and types of services your firm offers, I trust you have various "micro" business models as well.
The framework we used to evaluate our various business models was the Business Model Canvas created by Strategyzer. This framework focuses on nine building blocks that make up your firm's various business models. In this article, I will highlight three of the building blocks that stood out for us. For more information regarding the entire framework, I recommend picking up a copy of "Business Model Generation" by Alexander Osterwalder & Yves Pigneur.
Building Block: Customer Segments
The Customer Segments Building Block defines the different groups of people or organizations your firm intends to reach and serve. While you could quickly say who your main customer segments are, I'd challenge you to examine them in more detail. It’s likely that within at least one of your main customer segments, there are distinct differences that would influence how you position and deliver your services.
The Business Model Canvas will have you ask these two big questions regarding your Customer Segments:
- For whom are we creating value?
- Who are our most important customers?
- There are at least three big qualifiers for determining whether customer groups represent a separate segment:
- Their needs require and justify a distinct offer
- They require different types of relationships
- They are willing to pay for different aspects of the offer
Building Blocks: Channels
The Channels Building Block describes how your firm communicates with and reaches your Customer Segments to deliver your services. When we examined our channels, we found we could be more targeted depending on our services offering.
For example, the best channel to grow our Boomer Technology Circle community was not necessarily the best channel to grow our CIO Circle community. However, at face value, it could be easily assumed that the channels would be identical.
The Business Model Canvas will have you ask these six big questions regarding your Channels:
- Through which Channels do your Customer Segments want to be reached?
- How are you reaching them now?
- How are your Channels integrated?
- Which ones work best?
- Which ones are most cost-efficient?
- How are you integrating them with customer routines?
There are at least four big functions your firm's Channels serve:
- Raising awareness among customers about your firm's services
- Helping customers evaluate your firm's services
- Delivering services to your customers
- Providing post-purchase support
Building Block: Key Partnerships
The Key Partnerships Building Block describes the network of suppliers and partners that make the business model work. Your firm has many suppliers (e.g., technology and software providers) as well as partners on which your business model relies.
Are you fully leveraging these relationships to grow and serve your clients? We found that in some areas of our organization we were, and in other areas, we weren't.
The Business Model Canvas will have you ask these four big questions regarding your Key Partnerships:
- Who are your Key Partners?
- Who are your Key Suppliers?
- Which Key Resources are you acquiring from Partners?
- Which Key Activities do your Partners perform?
There are at least three types of Partnerships your firm can distinguish between:
- Strategic alliances between non-competitors
- Coopetition: strategic partnerships between competitors
- Joint ventures to develop new business
As you can tell, if you have the right people in the room, going through the Business Model Canvas can create a lot of positive energy and bring to light a lot of "a-has." Over the last several years, we have used this tool multiple times as we look to refresh services and launch new ones.
Every time we go through the process, new insights are learned and strategies are created. I'd challenge your firm to do the same.
The original article by Hubbard appeared in the Boomer Bulletin blog.
Jon Hubbard, Shareholder and Consultant at Boomer Consulting helps accounting firm leaders find success in the areas of leadership, talent and growth. Jon is a facilitator for the Boomer P3 Leadership Academy, Boomer Talent Circle, Boomer Marketing & BD Circle, and the Boomer Operations Circle. He also guides firms to grow and be more...